The energy regulator has moved to help cut household energy bills in future by rejecting business plans from five of the six companies that own and operate Britain’s local electricity network.

The five firms, whose activities form below 20% of an annual electricity bill, were found by Ofgem to not offer enough in terms of value to consumers in their plans.

The watchdog found that Western Power Distribution (WPD), which covers South Wales, the Midlands and the South West of England, was the only company that achieved eligibility to have its price controls agreed early.

It did not name the five firms which it said fell foul of its efforts to lower costs.

There are 14 regional distributors operating in the UK.

WPD's business plans, which cover the period from 1 April 2015 – 31 March 2023, included around £7bn of total expenditure, of which around £3bn was for investment to upgrade and maintain WPD's network.

Ofgem said the agreement meant the distribution element of the electricity bill would be reduced for its customers by an average of 11.6% or around £11.30 in 2012/13 prices.

Hannah Nixon, Ofgem's senior partner for distribution, said: "We understand that energy costs are a big concern for consumers and we set a high target for demonstrating value for money.

"We are pleased that nearly all companies have pledged to cut bills, but we feel that most companies can go further in cutting their costs and expect to see further improvements when they resubmit their plans in March.

Regulation of the distribution sector operates differently to that which sells direct to households and manages billing.

Customers have to rely on regulation from Ofgem to limit charges from distributors as they operate on a regional monopoly basis rather than in competition with each other, as the main energy companies do.

Those firms - dominated by the so-called 'big six' - have been under fire over inflation-busting rises to bills announced ahead of winter.

Those that have raised prices have pledged to cut the increases back should the Government confirm it will take the cost of green levies out of bills and shift them to general taxation.

Labour has demanded greater intervention to cap bills - accusing ministers of standing idle amid a cost of living crisis for families as price rises continue to outpace wage increases.